Update on the Final FY26 Budget

Local Aid

• UGGA: Unrestricted General Government Aid (UGGA) (1233-2350) is funded at $1.323 billion. This is less than the Senate and Governor’s budget ($1.33b), but $14.3 million more than the House’s budget, which was level with the final FY25 budget. UGGA is a crucial tool for cities and towns that funds non-education portions of municipal budgets. 
• Chapter 70: The final budget provides $7.361 billion for Chapter 70 assistance, as proposed by the House and Senate, via the traditional Chapter 70 line item, 7061-0008 ($6.864 billion) and Fair Share dollars ($496.9 million) via line item 1596-2450. The budget increases minimum aid funding to $150 per pupil, which is what both branches suggested in their budgets. The line item also includes $200,000 to study and make recommendations to improve the adequacy and equitability of Chapter 70 formula funding.
• Universal School Meals: Universal school meals are once again included in the budget and are split between two line items. The first is $180 million in Fair Share funding for reimbursement to schools. This is $10 million more than the Governor and Senate’s budget, but $10 million less than the House’s budget. The second is $4.46 million or 6% less than the $4.76 million suggested for the School Breakfast program (7053-1925) by the Senate. Combined, the budget is 5.5% less than what the House put forward, but 5.1% more than the Senate put forward. 
• McKinney-Vento Homeless Student Transportation: The FY26 budget, Conference Committee, Senate, House, and the Governor included $28.6 million for the McKinney-Vento Homeless Student Transportation program (7035-0008). This is level with the final FY25 budget.

Public Health and Safety

• Healthy Incentives Program (HIP): The Healthy Incentives Program (HIP) (4400-1004 and 4400-1001) is funded at $25.2 million, a 4.5% increase from the Governor’s proposal, roughly in line with the House’s proposal and 17.8% less than the Senate’s proposal. This program provides a dollar-for-dollar match for each SNAP dollar spent on fruits and vegetables at farmers markets, farm stands, and Community Supported Agriculture Programs. 
• State Action for Public Health Excellence (SAPHE): The Governor, House, Senate, Conference Committee and final budgets all include $9.2 million for the State Action for Public Health Excellence (SAPHE) grant program (4512-2022). This is a 9% decrease from last year’s budget. The SAPHE Grant Program strengthens local public health services and protections to residents in 91% of Massachusetts’ cities and towns through cross-jurisdictional sharing. 
• Disaster Relief Fund: The budget includes $14 million for the “Disaster Relief and Resiliency Fund” (Section 122). This is $1 million less than the Governor proposed, but $14 million more than the Senate’s budget. The account is a special revenue fund administered by Administration and Finance (A&F) to support disaster relief efforts for state, local, and regional governments, businesses, nonprofits, or residents. 

Housing

• Massachusetts Rental Voucher Program (MRVP): The MA Rental Voucher Program (MRVP) (7004-9024) is funded at $253.3 million, a decrease of $4.8M over the House’s budget but in line with the Governor and the Senate’s FY26 proposals. This is still $34M more than last year’s budget. Through a combination of project-based vouchers and mobile vouchers, MRVP helps to move homeless families and individuals out of motels, off waiting lists, and into decent homes they can afford. 
• Residential Assistance for Families in Transition (RAFT): The Residential Assistance for Families in Transition (RAFT) program (7004-9316) is funded at an increased level of $207 million, a 5% increase over FY25 and $5 million more than the Governor’s FY26 proposal. However, it is also $17.6 million less than the Senate’s budget. This program provides rental, mortgage, utility, and relocation assistance for those at risk of losing their home to prevent and address displacement and foster housing stability among housing insecure households. 
• Emergency Assistance Family Shelters and Services: The Emergency Assistance Family Shelters and Services program (7004-0101) final budget is in line with the Senate and the House budgets and funds the program at $275 million; $50M less than the Governor’s FY26 proposed budget and the final FY25 budget. During FY25 supplemental budgets, there were changes made to services offered to limit time and eligibility for the program. 
• Access to Counsel: The budget includes $2.5 million for access to legal counsel for low-income tenants and low-income owner occupants in eviction proceedings (0321-1800). While the Governor proposed $2.5 million for this program, the House proposed $3 million. The Senate did not include any funding for this line item in its budget. Additionally, the House proposed $5 million for an immigration legal services program (4003-0124), which was also included in the final budget. 

Transportation

• MBTA & Regional Transit Authorities (RTAs): MBTA (1595-6369) funding is set at $470.2 million, a 49.7% increase over FY25 but less than the $687 million put forward by the Governor and the House and $500 million put forward by the Senate. Like the House’s budget, the final budget sets aside $10 million for the workforce academy ($30 million less the House proposed), $10M for ferry operation grants (in line with the House’s budget), and $1.3 million for a demonstration ferry between East Boston and Long Warf. RTA funding (1595-6370) is set at $209 million, $5M more than the House and the Governor’s proposals but $5 million less than the Senate’s budget. Of the $209 proposed, $115 million will be broken down as follows: $66 million is for operational enhancements, $35 million will be for year-round fare-free service, $10 million for new or altered routes to connect other systems or important areas, $4 million for extended mobility grants, and $3.5 million for additional operating assistance. 

Environment

• Department of Environmental Protection: The budget sets DEP funding at $53.5 million, which is slightly less than the Governor, House, and Senate budgets all proposed ($54.1 million via 2200-0100). It is also a slight decrease over FY25. 
• Department of Public Utilities: The budget funds DPU operations (2100-0012) at $18.6 million, slightly less than Senate and House budgets. This is a 9% or $2 million decrease in funding over FY25. DPU provides critical oversight for the implementation of emissions targets for the Commonwealth. 

Economic Development

• Childcare Grants to Providers: The budget allocates $360 million for the Childcare Grants to Providers (1596-2410), in line with the House’s proposal. This is $35 million more than the Senate’s budget proposal and $85 million more than the Governor’s budget. In all instances, the funding is provided by Fair Share surtax funding. 
• MassReconnect & Free Community College: The budget provides two different avenues to fund free community college. First, $24 million is provided directly to the MassReconnect program (1596-2418), and an additional $96 million is provided for free community college via line item (1596-2501). This funding mirrors the Houses proposal, which suggested $24 million for MassReconnect and $94 million for free community college via the same line items.
• Fair Share Revenue: FY26 is the third year that the Fair Share Amendment, which establishes a 4% surtax on annual personal incomes over $1 million, is available to support education and transportation. Transportation line items are proposed to receive $712 million (30%), and education proposals receive $1.688 billion (70%) in the budget. In FY25, the state allocated $250 million to the Commonwealth Transportation Fund to be leveraged for bonding for transportation infrastructure projects. In FY26, the Legislature increased this to $550 million. The Governor proposed increasing this even further to $765 million, and this is one of the centerpieces of her plan to leverage borrowing to yield $5 billion over the next 10 years for rail, roads, bridges, RTAs, culverts and more. The final budget does not go as far as the Governor and only transfers $550 million to the Commonwealth Transportation Fund, reducing the bonding ability to ensure funding for the other proposed transportation bills.

Outside Sections of Note

State and Federal Grant Support (Section 16): This section would allow regional planning agencies (RPAs) to use District Local Technical Assistance funding to help municipalities with state and federal grant support. This was originally included in the Senate’s budget. 

Housing Production Dashboard (Sections 12 and 132): This section would require EOHLC to create a public dashboard that shows the amount of funding awarded to a project, the date of the award, the number of units, affordability mix, whether the units are new or rehabilitated, rented or owner occupied, accessible, and construction status of the project among other requirements. This was originally included in the Senate’s budget.  

Education and Transportation Fund Technical Update (Section 18): Increases the amount of dedicated transportation income surtax revenue to the Commonwealth Transportation Fund to $550 million from $250 million. The Governor proposed increasing this to $765 million, the House proposed $500 million, and the Senate proposed $600 million.   

Residential Broker Fees (Sections 43, 54, 55, and 136): The budget bars realtors or lessors from charging more than the first and last month's rents along with a security deposit of an additional month. The person, lessor, or tenant who originally engaged and entered into a contract with the licensed broker or salesperson is responsible for paying the broker's fee. This closely mirrors the Senate’s language.

Transportation Funding Tracking Website (Section 19): Requires MassDOT to create a publicly available website that tracks spending and progress on projects that cost more than $1 million. This was included in the Senate’s budget.

Campaign Funds for Adult-Care Services (Sections 32, 33, 133): Would allow campaign funds to be used for adult care services for adult dependents. This was adopted in the House.

Affirming Health Care Trust Fund (Section 42): Creates a fund, subject to further appropriation, for gender-affirming health care services. This was adopted by the House. 

Fare-Free Regional Transit Authorities (Section 52): Allows RTAs to operate fare free transit and report on ridership to MassDOT. This was adopted by the Senate. 

Health Connector 500% FPL Connector Care Pilot Extension (Sections 96-98): Extends the Connector Care pilot for an additional year. This was adopted by the House. 

Crumbling Foundations Working Group (Section 105): Creates a working group to develop recommendations for regulatory and legislative changes necessary to address and finance a Crumbling Concrete Assistance Fund. 

Housing Construction Sales Tax Study (Section 106): Directs EOHLC and DOR to study the feasibility of a housing construction sales tax exemption or other mechanism to restart stalled multifamily home construction where projects were stalled by material cost. It also directs them to study the possibility of letting municipalities exempt new affordable housing from certain tax limits, among other things. 

Multifamily Housing Project Inspection Study (Section 107): Directs EOHLC and the State Board of Building Regulations and Standards to study the feasibility of allowing third-party inspectors to inspect manufactured housing, off-site construction, and multi-family housing projects. This was included in the Senate’s budget.

Local Property Tax Exemption Study (Section 108): Allows EOHLC and others to study the impacts of a local option property tax exemption for new affordable housing developments. This was adopted by the Senate. 

Telehealth Task Force (Section 109): The task force will investigate the barriers and impediments to the practice of telehealth across state lines. This was adopted by the House. 

Amended by the Governor 

Secure Choice Retirement Savings (Initially Sections 20, 23 and 110 of the Conference Budget): Creates an individual retirement account (IRA) program—at no cost to employers—that would automatically enroll workers who don’t have access to employer-based retirement benefits. This was included in the House’s budget. The Governor struck Sections 23 and 110 and amended Section 20 to establish a task force to review and provide recommendations on options to promote and foster financial security in retirement for Massachusetts residents instead of creating the program in full.  

Not Included in the Final Budget 

School Sports Report: The House included an amendment that would further study school sports participation and outcomes as it pertains to Title IX. The study would require school districts to report to DESE on the outcomes for certain teams, injuries, and if additional restrictions are needed to comply with Title IX.  

Returning Liquor License Control to Municipalities: The Senate voted to provide municipalities with more authority to make decisions about the number of liquor licenses while also providing additional local control.